by Frank E. Riggs
Prequalify the Project Team
Form of the
Strength of the
Other Party to
Is our contract directly with the owner?
Is our contract with a CM or GC?
Is our contract with a subcontractor?
Have we done business with this entity before?
Did we have prior problems/payment difficulties with this entity?
Have we asked about the contracting entity’s reputation?
Have explored the owner/contractor’s financial history and strength (D&B,
Have we accessed PACER to identify federal court lawsuits involving a project
Have we checked CourtLink to identify state court lawsuits?
Have we searched local state court dockets for pending lawsuits?
Have we made efforts to evaluate the project team member’s propensity to
How is the project being financed?
Do we have a contract right to request proof of financing?
Have we requested/received proof of adequate project financing?
Have we requested/received a letter from the lender regarding adequate
Have we identified lien filing/notice requirements?
Are we entitled to lien protection in the project jurisdiction?
Do we have a project legal description?
Are there pre-construction notice/filing requirements?
Is there a project payment bond?
Does the project jurisdiction provide trust fund protection?
Are security interests possible?
Is there a prompt payment statute?
Who is the public owner?
Will this contract comply with public bidding requirements?
Is a payment bond required by public procurement statutes?
Have we requested a copy of a payment bond furnished by a GC?
How is the public project being financed?
Is our contract properly authorized (e.g., approved Board of Education minutes)?
Have we requested and received confirmation that public procurement
requirements have been met?
Are we aware of unusual owner budget/financing concerns?
Is the owner experienced with construction projects?
Has our request for project financing information been refused?
Is the contractor on the federal government’s list of disbarred contractors?
Are there likely problems with the project site (e.g., limited access, poor site
conditions, congested site)?
Is the proposed construction contract extremely one-sided?
Is there a termination for convenience clause with limited recovery?
1 If your contract is not directly with the owner and if you have a pay-if-paid clause in your contract, then the owner’s
financing and ability to pay is at least as important as the GC/CM’s ability to pay and financial strength.